PVC demand in Europe drops 5-7% annually

MOSCOW (MRC) -- PVC demand in Europe overall has dropped 5-7% annually since 2007 and a rebound is not expected soon, according to the European Council of Vinyl Manufacturers. However, Eastern Europe holds promiseб said Plasticsnews.

"Interestingly, production of PVC is growing in the eastern part of Europe due to widespread construction projects. Turkey is among the key markets in Europe where lots of construction is going on," said Brigitte Dero, general manager of the council.

In 2007, 15.2 billion pounds of PVC was made in Europe, she said. "It may take a minimum of five years or even more than that to regain the earlier ground," Dero said.

When asked if Europe is exporting PVC to other markets, she replied, "We may export in small quantity; we have to look beyond to other markets. We have overcapacity and look for exports to markets like Croatia, Turkey, eastern parts of Europe and in the future to Asia."

She added, "Currently, there is no export of PVC to Asia — only finished products like profiles."
India also could be a big market for exports "as there is limited production capacity, and the PVC industry is more dependent on imports."

While PVC use is increasing in Asia and Eastern Europe because of widespread construction programs, there is a lack of recycling and sustainable development efforts, Dero noted.

Overall, however, Europe recycled almost 800 million pounds of PVC waste in 2012 under its VinylPlus program, and aims to recycle 1.8 million pounds annually by 2020, according to Dero. VinyPlus is managed by a comprehensive board representing all of Europe’s PVC industry sectors.

In Europe, about USD90 million was spend in the past decade to recycle PVC, Dero said, and there are plans to spend around USD6.5 million annually for the next 10 years "to achieve maximum sustainable development in the PVC business."

As MRC wrote before, Russia's investments in processing of PVC in 2012 made USD74.3 mln, down 21% from 2011, when investments rose sharply after two-years fall in investments. Investments in PVC processing in 2008 was 2.5 times higher than in 2012. In 2012 there were installed 436 production lines with total capacity of PVC processing about 450,000 tonnes/year, down almost 21% from 2011.

MRC

MOSCOW (MRC) -- LANXESS posted lower earnings in the first quarter of 2013 as expected due to a weak market environment, particularly in the tire and automotive industries, said the producer.

First-quarter sales were down by 12% year-on-year to EUR 2.1 billion, mainly due to lower volumes and fallen selling prices. EBITDA pre exceptionals moved back by 53% against the prior-year period to EUR 174 million and was thus within the target corridor of between EUR 160 million and EUR 180 million communicated in March. The operating result was diminished by scheduled one-time effects of about EUR 30 million for the start-up of the new butyl rubber plant in Singapore and the conversion to Keltan ACE technology at the EPDM rubber plant in Geleen, Netherlands.

At the start of the year, LANXESS already initiated temporary facility shutdowns in the Performance Polymers segment in line with its proven policy of flexible asset and cost management. Now additional measures are planned in the Performance Chemicals segment.

LANXESS is also reducing its capital expenditure budget for 2013 to EUR 600 million from the previously planned level of EUR 650 million to EUR 700 million.

In the polymers segment, sales moved back by about 18% to EUR 1.1 billion. Here, a drop in selling prices as a result of lower raw material prices led to a negative price effect. In addition, volumes were down on account of lower demand from the automotive and tire industries. EBITDA pre exceptionals fell by 56% to EUR 112 million. Earnings were diminished due to the above-mentioned one-time effects of about EUR 30 million.

As MRC wrote earlier, LANXESS has broken ground for its new neodymium-based performance butadiene rubber (Nd-PBR) plant in Singapore. The German specialty chemicals company is investing roughly EUR200 million in a 140,000 metric tons per annum facility on Jurong Island.

LANXESS is a leading specialty chemicals company with sales of EUR 8.8 billion in 2011 and currently around 16,900 employees in 31 countries. The company is currently represented at 48 production sites worldwide. The core business of LANXESS is the development, manufacturing and marketing of plastics, rubber, intermediates and specialty chemicals.

MRC

MOSCOW (MRC) -- Exxon Mobil's first quarter 2013 earnings were USD9.5 billion, up 1% from the first quarter of 2012, reported the company in its press release.

Capital and exploration expenditures for the first quarter were USD11.8 billion, including USD3.1 billion for the acquisition of Celtic Exploration Ltd.

The corporation distributed USD7.6 billion to shareholders in the first quarter through dividends and share purchases to reduce shares outstanding.

Upstream earnings were USD7,037 million in the first quarter of 2013, down USD765 million from the first quarter of 2012. Downstream earnings were USD1,545 million, down USD41 million from the first quarter of 2012.

Chemical earnings of USD1,137 million were USD436 million higher than the first quarter of 2012. Higher margins, mainly commodities, increased earnings by USD320 million. All other items, including gains on asset sales, increased earnings by USD120 million. First quarter prime product sales of 5,910 kt (thousands of metric tons) were 427 kt lower than last year's first quarter due mainly to the Japan restructuring.

Corporate and financing expenses were USD219 million for the first quarter of 2013, down USD420 million from the first quarter of 2012, reflecting favorable tax impacts.

As MRC wrote earlier, in early 2012, ExxonMobil started operations at one of the world's largest ethylene steam crackers, the centerpiece of the company's multi-billion dollar expansion project at its Singapore petrochemical complex. The expansion adds 2.6 million tpy of new finished product capacity. It includes two new polyethylene (PE) plants, a polypropylene (PP) plant, a metallocene elastomers unit, an oxo-alcohol unit and an aromatics expansion, all of which are completed and beginning operation.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3 percent of the world's oil and about 2 percent of the world's energy.
MRC

MOSCOW (MRC) -- Foster Wheeler announced that a subsidiary of its Global Engineering and Construction Group has been awarded a contract by OJSC Gazpromneft Moscow Refinery to provide front-end engineering design (FEED) and design documentation in accordance with Russian norms, for a major investment, termed the Combined Oil Refinery Unit (CORU) Project, at the Moscow Refinery, said Yourpetrochemicalnews.

The value of the award was not disclosed and will be included in Foster Wheeler’s first-quarter 2013 bookings.

The CORU project is part of the implementation of Gazpromneft’s OJSC Moscow Refinery Revamping and Upgrading Program, under which the refinery will be expanded up to 2020 to process an additional six million tons of crude oil per year and produce transportation fuels to Euro-V standards.

The CORU facilities are planned to include crude distillation and vacuum distillation units (CDU & VDU), a continuous catalytic reforming unit with naphtha hydrotreatment and hydrogen recovery by pressure swing adsorption, a diesel hydrotreater including a dewaxing section, a gas plant with a liquefied petroleum gases sweetening unit and common utilities. The FEED activities are expected to be completed in the fourth quarter of 2013 while the submission of design documentation is scheduled for the first quarter of 2014.

Foster Wheeler was previously awarded the process design package for the facilities’ crude and vacuum distillation units and the gas plant.

"The CORU Project is the most important investment for our Moscow Refinery. Timely completion and plant start-up are vital for our company, but completion of a strong FEED is a very important first step in the realization of this key project," said Anatoli Moiceevich Cherner, Deputy Chairman of the Board, Gazpromneft.

As MRC reported earlier, Lanxess had awarded a subsidiary of Foster Wheeler's Global Engineering and Construction Group an engineering, procurement and construction management (EPCm) contract for a new ethylene propylene diene monomer (EPDM) rubber plant to be built in Jiangsu Province, China. Besides, Foster Wheeler was awarded a contract by Shell Global Solutions to develop the basic engineering package for a world-scale mono-ethylene glycol (MEG) facility at Ras Laffan, Qatar.
MRC

MOSCOW (MRC) -- Fushun Petrochemical (Liaoning, China) is likely to take its polyethylene (PE) units off-stream for maintenance turnaround, said Apic-online.

A source in China informed that the units are planned to be taken off-stream on May 15, 2013. They are likely to stay shut for around one month.

As MRC informed earlier, a subsidiary of PetroChina - Fushun Petrochemical - in the second half of this year, started production of basic petrochemical products at its new plant in Fushun, Liaoning Province, China. The design capacity of the petrochemical complex is 300,000 tpa of polypropylene (PP), 350,000 tpa of high density polyethylene (HDPE) and 450,000 tpa of linear low density polyethylene (LLDPE).

PetroChina Company Limited is a Chinese oil company and is the listed arm of state-owned China National Petroleum Corporation (CNPC), headquartered in Dongcheng District, Beijing. It is China's biggest oil producer and the most profitable company in Asia.

MRC